Boeing Dreamliner on track, but rework may stretch to 2015

The 787 Dreamliner program remains on track to ramp up to 10 airplanes a month by the end of next year, Boeing executives said Monday, and they are now focused on cutting costs on the jet to reach profitability.

They also said suppliers have begun to build the major structural sections of the 787-9 model in development. The first 787-9 is on schedule to start final assembly in late spring or early summer and to fly within a year.

Some of the Dreamliners that rolled out early remain a challenge, however.

Larry Loftis, head of the 787 program, said that by Dec. 31 Boeing will have modified and prepared for delivery a majority of the Dreamliners needing rework that were parked on the Paine Field flight line in Everett.

But those 787s that have been reworked up to now were later-build jets requiring much less modification than the earliest Dreamliners.

The latter need extensive, time-consuming work that will continue into 2015, Loftis said.

“By the end of the year, we should be in a position where … we would burn through about 60 percent of the airplanes we had up on the tarmac here,” Loftis said. “We’ll spend largely 2013 and 2014 and into 2015 redoing and finishing up the remaining airplanes.”

Loftis and Boeing Senior Vice President Pat Shanahan, who heads all airplane programs, gave the 787 update in a teleconference call with RBC Capital Markets analysts and investors.

Shanahan said production is now split between three final assembly lines, two in Everett and one in North Charleston, S.C. He said he anticipates a 70-30 split in production between the two sites as the rate of 10 jets per month is achieved next year.

Boeing may go to an even higher production rate later, and the Charleston line specifically is “sized to be larger,” Shanahan said.

Right now, however, the program is most focused on working with suppliers to bring down costs.

“We’ve been very focused on getting the airplane into service and going up in rate,” Shanahan said. “Now we need to focus on cost savings.”

Boeing has delivered 38 Dreamliners to eight airlines, 35 of them this year. That means it has achieved the low end of the delivery range projected earlier in 2012.